Roth IRAs

Established in 1998, named after former Senator William Roth, chief legislative sponsor

Provides retirement savings opportunity on a tax-advantaged basis

Main Advantage – Tax-Free Income Potential

Main differences to traditional IRA

No deductible contributions

Owner has no Required Minimum Distributions (RMD)

Tax-free income with qualified distributions

Generally, must meet both of the 2 following conditions

Distribution takes place at least 5 years after 1st contribution to a Roth IRA and

Roth IRA owner has attained age 59 ½

Conversion Opportunities

Converting from a tax-deferred retirement account to a Roth IRA

Income taxes paid on conversion

10% premature distribution penalty does not apply

If taxes are paid outside of IRA assets

What Accounts Can Be Converted?

Individual Accounts

Traditional IRAs

Inherited IRAs (taken over as their own from deceased spouse)

Self-employed/small business accounts

SEP IRAs

SIMPLE IRAs

Employer accounts from previous job

Rollover IRAs

401(k) plans

403(b) plans

457 plans

The information provided is not written or intended as specific tax or legal advice and may not be relied on for purposes of avoiding any Federal tax penalties. MassMutual, its employees and representatives are not authorized to give tax or legal advice. Individuals are encouraged to seek advice from their own tax or legal counsel.

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